English
Language
  • English - India
  • English
TAXAJ Corporate Services LLP - Financial Doctors

Generate Free Rent Receipts

Whether you are a beginner or an experienced professional, the HR of your company will ask you for rent receipts for the purpose of Income Tax Declaration. This is the time when most employees get frantic and check with their friends or colleagues about the best way to arrange these receipts. Most employees do not understand why these rent receipts are important or how they help you save tax.

Let us delve deep into this subject and get an in-depth understanding of why we need rent receipts:

  • Avoid last minute hassle of arranging rent receipts
  • Fill the required details
  • Print the receipt in PDF Format
  • Get the receipt signed from your landlord
  • Submit it to your company's HR department

Frequently Asked Questions

Why do you need to submit rent receipts?

If an employee wants to claim income tax benefit on House Rent Allowance (HRA), he/she has to provide the proof of payment of rent to the employer. In this regard, rent receipts serve as evidence. Basis the receipts submitted, the Indian Government provides deductions and allowances to the employee.

What is the tax benefit of monthly rent paid?

In case you are a salaried professional and you live in a rented house, you can avail HRA exemption to save tax under Section 10 (13A) of the Income Tax Act. For those who are self-employed, they can avail HRA tax deduction under Section 80GG.

You can calculate the HRA exempted amount using the steps mentioned below:

  • Step 1: Actual HRA received from the employer
  • Step 2: The rent you actually pay - 10% of sum of basic salary & Dearness allowance
  • Step 3: In case you stay in a metro city, 50% of your basic salary & dearness allowance, else 40% of your basic salary & dearness allowance.

The lowest of these 3 components will be a part of your Exemptions, in Income Tax Calculation. Your final tax liability will be calculated based on the exempted HRA amount.

Understanding components of a valid rent receipt

As explained above, a salaried employee has to submit a rent receipt as a proof of rental expenses to his company - this is in accordance with the Income Tax Act, 1961. A rent receipt is provided by the landlord when he receives the rent from the tenant - it has his signature that confirms the receipt of payment. If you are paying rent, you can submit evidence and save tax - total amount is reduced from your gross taxable income.

A rent receipt is only valid if it has certain components:

  • Tenant Name
  • Landlord Name
  • Rent Paid
  • Rental Period
  • House Address
  • Signature of Landlord

Some other elements that could be a part of the receipt include: PAN of the landlord, if annual rent exceeds ₹1,00,000 in a year and Revenue Stamp (where amount exceeding ₹5000 is paid).

How to use this FREE Rent Receipt Generator

Please find below the steps to generate the rent receipts for FREE:

  • Step 1: Fill in your full name and the monthly rent you pay to your landlord
  • etmoney rent receipt genrator step1

  • Step 2: Fill in your house owner's name, PAN number (if you have) and the full address of the rented property, where you resideetmoney rent receipt genrator step2

  • Step 3: Enter the duration for which you need to generate the rent receipts
  • etmoney rent receipt genrator step2
  • Step 4: You can preview the sample receipt on the final screen and print all of them with just 1 click.etmoney rent receipt genrator step4


Important points to remember
  • One must have a valid rent agreement - the agreement has to have all the relevant details including monthly rent, time period of agreement or any utility bills.
  • If it is a shared accommodation, then all the details must be mentioned in the agreement, along with the number of tenants, ratio of how rent and utility bills are to be divided.
  • It is better to pay rent online rather than by cash. This helps you keep track of the transactions in a seamless manner.
  • One must ask for a rent receipt every time rent is paid. It is important to share rent receipts with the employer to claim HRA exemption for monthly rent paid above ₹3,000
  • Besides rent receipts, if the rent payment exceeds ₹1 lakh annually, then it is mandatory to provide the PAN of the landlord to your employer to avail the full benefit of HRA exemption.
  • If the PAN is not available, then the landlord must be ready to give a declaration. This must be confirmed before deciding on a house for rent. Along with the declaration, one needs to also obtain 'Form 60' duly filled by your landlord. These documents need to be submitted to the employer.
  • There could be a situation, where an employee might pay a higher payment different from what is mentioned in the rent agreement. In this case, tax exemption is calculated on the basis of the rent receipt shared by the employee.

Frequently asked questions about HRA
Why do I need to get a receipt from my landlord?
Your employer needs a proof of rent payment to allow exemption on HRA. The employer is required to collect proofs from you before allowing any exemptions & deductions. This is your employer’s responsibility as per the income tax act.
Do I need a lease agreement with my landlord?
Yes, you need a lease agreement with your landlord. This agreement must have details of the accommodation on lease, period of lease and rent. This document may also have to be submitted to your employer.
Why does my company ask me to submit rent receipt proofs?
To allow you exemption on HRA, it is mandatory for the employer to collect proof of rent payment. The employer will give you exemption on HRA based on these rent receipts. Your final tax liability will be calculated accordingly. Your TDS shall be adjusted so you don’t have to pay tax on HRA.
Do I need a receipt for every month?
Usually, employers need receipts for 3 months or so.
Do I need the PAN number of my landlord?
If the annual rent paid by you is more than Rs 1,00,000, it is mandatory to obtain PAN of the landlord and report it to the employer to claim HRA exemption.<br><br>In case the landlord does not have a PAN, you can ask for a declaration to this effect from the landlord with name and address of the landlord. And keep it safely in your records.
Do I need a scanned copy of my landlord’s PAN card?
No, you don’t need to keep a scanned copy of your landlord’s PAN.
I was not able to claim HRA from my company. Can I claim it myself?
Yes, HRA exemption can be directly claimed in your income tax return. You can use this calculator to find out the exempt portion of HRA. This exempt amount has to be reduced from your total taxable salary. The net amount is shown as your ‘income from salary’ in your income tax return.<br><br>In case you claim HRA exemption directly in your tax return, you must maintain rent receipts and lease agreement safely in your records; in case the assessing officer asks for them later.
I have changed jobs this year. Should I share my old rent receipts with the new company?
If your current employer is allowing you HRA exemption from previous job's income, you may be required to submit your old rent receipts. Do remember to disclose your salary from your previous employment to your current employer in Form 12B.
My landlord is refusing to give me a rent receipt. What can I do?
In case your landlord does not provide you a rent receipt you may not be able to claim HRA exemption. Do agree with your landlord regarding rent receipts before taking the accommodation on rent.
I was in a rental apartment for part of the year. Can I claim HRA?
Yes, you can claim HRA exemption for the months you were paying rent.
Is there a deadline for submitting proofs (rent receipts) to my company?
Since employers need to deduct and deposit TDS timely, they usually provide a deadline by which all tax proofs must be submitted. By submitting your rent receipts and other proofs timely, you can make sure no extra TDS is deducted on your income.<br><br>However, do not worry if you miss this deadline. You can claim HRA exemption directly in your income tax return.

Do I need hard-copy of rent receipts or is a soft copy OK?
Check with your employer about the format in which you have to submit.